The Finance Minister will address the media today at a time when the country’s economic growth has slowed to an over six-year-low.
Gross domestic product growth came in at 4.5 percent in the second quarter of 2019-20 compared to 5 percent in the first quarter. In gross value-added terms, the economy grew at 4.3 percent compared to 4.9 percent in the previous quarter.
The government on its part has initiated various measures since August to curb the slide. It reduced corporate tax rates, introduced a special rescue fund for stuck housing projects, announced relief measures for exports and brought a new partial guarantee scheme allowing state-run banks to buy lower-rated assets from non-banking lenders for improving credit offtake. It has also directed banks that no stressed small business be declared a bad loan.
However, those efforts are yet to show up in the numbers. Retail inflation has surged to the highest in over three years due to a steep rise in prices of vegetables like onions and pulses. Industrial output has contracted due to weakness in manufacturing, mining and electricity generation. Besides, exports have fallen for a fourth straight month.
All this throws up a significant challenge heading into the new year for Nirmala Sitharaman, as she also prepares to deliver the Union Budget in the next one month.
Follow the updates from today’s press conference live here.
